The Impact of Health Care Reform on Public Programs

Cindy MannCenter for Children and Families

Georgetown University Health Policy Institute

http://ccf.georgetown.edu

National Health Policy Conference

Academy Health

February 2-3, 2009

11%

29%

4%

55%

Public Programs’ Coverage Role Today (Non-elderly, 2007)

20%

11%

6%63%

Source: Kaiser Commission on Medicaid and the Uninsured/Urban Institute analysis of 2008 ASEC Supplement to the CPS.

Children = 78.6 million

Individual Coverage

Employer-Sponsored Insurance

Medicaid/ Other Public

Uninsured

Adults = 182.8 million

NOTE: Does not include spending on SCHIPSOURCE: Kaiser Commission on Medicaid and the Uninsured, based on A Catlin et al, “National Health Spending in 2006: A Year of Change for Prescription Drugs,” Health Affairs 27(1)14-29, January/February 2008. Based on National Health Care Expenditure Data, CMS, Office of the Actuary.

Total National Spending(billions)

$2,106

$648 $660 $125

$217

Medicaid as a share of national health care spending:

Medicaid in the Health System, 2006

Income and Health Status of Medicaid and the Low-Income Privately Insured, 2002

Percent of Enrolled Adults:

Poor Health Conditions that

limit work

Fair or Poor Health

SOURCE: Coughlin et. al, “Assessing Access to Care Under Medicaid: Evidence for the National and Thirteen States,” Health Affairs 24(4):1073-1083. Based on a 2002 NSAF analysis for Kaiser Commission on Medicaid and the Uninsured.

Medicaid Low-Income andPrivately Insured

42%

28%

15%

15%

Income Levels of Uninsured, 2007

35%

29%

25%

11%

Source: Kaiser Commission on Medicaid and the Uninsured/Urban Institute analysis of 2008 ASEC Supplement to the CPS.

Children = 8.9 million Adults = 36.1 million

Under 100%

100-199%

200-299%

300% +

70% below 200% FPL 84% below

200% FPL

Obama plan maintains Medicaid and SCHIP, but no details yet.

Proposals

Baucus plan extends Medicaid to all below 100% FPL and requires states to cover children in SCHIP up to 250% of FPL; higher levels required/permitted.

Key Issues

• Achieving national uniformity amidst state variation

• Financing public program expansions/improvements

• Assuring public programs work as they should in the context of universal coverage

Minimum Medicaid Income Eligibility Levels

133% 133%

100%

74%

0%

45%

0%

25%

50%

75%

100%

125%

150%

PregnantWomen

Children (0-5) Children (6-19) Elderly/Disabled Parents Childless Adults

Sources: B. Bruen, et al., “State Usage of Medicaid Coverage Options for Aged, Blind, and Disabled People,” Urban Institute (August 1999); and Kaiser Commission on Medicaid and the Uninsured, "Medicaid Eligibility for Families and Children" (September 1998).

Note: The income level for parents represents the median maximum AFDC payment level as of June 16, 1996.

Number of States that Cover Above the Federal Minimums

POPULATION NUMBER OF STATES

Children 51

Pregnant Women 45

Parents 25

Elderly/Disabled 20

Sources: D. Cohen Ross and C. Marks, “Challenges of Providing Health Coverage for Children and Parents in a Recession,” Kaiser Commission on Medicaid and the Uninsured (January 2009); B. Bruen, J. Wiener, and S. Thomas, “ Medicaid Eligibility Policy for Aged, Blind, and Disabled Beneficiaries,” Urban Institute (November 2003).

Source: D. Cohen Ross, A. Horn, & C. Marks, “Health Coverage for Children and Families in Medicaid and SCHIP: State Efforts Face New Hurdles,” Kaiser Commission on Medicaid and the Uninsured (January 2008);updated by the Center for Children and Families. Note: States with asterisks (*) have enacted, but not yet implemented to the levels shown.

FL

NC*

SC

GALA*TX

AL

AR

KS*

OK*AZ TN

MS

NVUT

NM

CA

WYID

WA*

ORND

SD

NE

MT*

MO

IN*

MI

WI

IL

ME

OH*

KY

HI

AK

PA

WV* VA

CTNJ

DEMD

RI

NHVT

DC

MA

CO*

IA*

NYMN

Medicaid and SCHIP Eligibility Levels for Children, January 2009

> 250% FPL (21 states)

200% FPL (16 states)

201%-250% FPL (9 states)

< 200% FPL (4 states)

Federal-State Partnership(State and Federal Spending on Acute Care, 2009-2014)

Sources: Center for Children and Families analysis based on Congressional Budget Office, “March 2008 Baseline: Medicaid” (March 11, 2008); and Congressional Budget Office, “Cost Estimate of H.R. 2 Children’s Health Insurance Program Reauthorization Act of 2009” (January 13, 2009). Note: SCHIP spending includes administrative costs.

Medicaid Spending

SCHIP Spending

State Dollars$758.1billion

$14.0billion

Federal Dollars

$1,005.0billion

$32.6billion

TOTAL$1,763.1

billion

$46.6billion

4 Out of 10 Medicaid Dollars are Spent on Medicare Beneficiaries

“Dual” Eligibles$133.3 billion

43.9%

Source: Urban Institute estimates based on data from the Medicaid Statistical Information System (MSIS) and Medicaid Financial Management Reports (CMS Form 64) prepared for the Kaiser Commission on Medicaid and the Uninsured, 2008.

Total Medicaid Expenditures = $303.6 billion

Unknown$11.6 billion

3.8%

Children$47.5 billion

15.6%

Adults$32.0 billion

10.5%

Other Aged and Disabled

$79.2 billion26.1%

Source: S.Dorn, et al.,”Medicaid, SCHIP and Economic Downturn: Policy Challenges and Policy Responses,“ Kaiser Commission on Medicaid and the Uninsured, April 2008. Note: a 1% increase in unemployment also equals a 3-4% decline in state revenues.

Impact of Unemployment Growth on Medicaid and SCHIP

1%

Increase in National Unemployment Rate

=1.0

Increase in Medicaid &

SCHIP Enrollment

(million)

&

1.1

Increase in Uninsured

(million)

$3.4

$2.0

$1.4 State

Federal

Increase in Medicaid & SCHIP Spending

(billion)

Public Program Eligibility and Take Up for Children

Source: Background estimates for Julie Hudson and Thomas Selden, "Children's Eligibility and Coverage: Recent Trends and a Look Ahead," Health Affairs 26(5): w618-w629 (September 2007).

Take-up Rate 70.5% 78.3%66.4%

(Some) Other Issues

• Benefits• Access/payment rates• Integration among components• Quality standards/improvements• HIT